Pre-pack administration for law firm

SEVERAL businesses within the Parabis group, including two with Leeds offices, have entered a pre-pack administration after cash flow problems put the firm in crisis.

Cogent Law and Plexus Law, two of the businesses in question, have offices in Leeds.

Plexus, Parabis’ personal injury claims division is being sold to a new entity set up by Parabis founder Andrew McDougall.

Duke Street Capital had purchased the group in 2012, making Parabis the first Alternative Business Structure law firm to be packed by a private equity company. Duke has already written its £30m investment off according to Sky News.

2,000 jobs across 20 offices have been secured by the pre-pack deal, and only a “handful” are said to be at risk.

Peter Saville, Ben Browne and Anne O’Keefe, of global business-advisory firm AlixPartners Services UK were today appointed joint administrators over a number of entities within the Parabis group, including Plexus and Cogent.

The appointment of administrators was made by the directors and members of the individual businesses within the group after a strategic review following a period of financial difficulty and “significant” legislative change.

Peter Saville said: “The Group has been in discussions with its lenders and private equity backer for a prolonged period with a view to restructuring what is a complex business operating in an increasingly challenging legislative environment.

“Despite the receipt of further support from its financial stakeholders, the Group was unable to resolve its cash flow issues and sought to market itself for sale. As a result of that marketing process it became apparent that in the current environment a sale of the group as a whole was not a viable option and the liabilities attached to Group entities also precluded a solvent sale.”